Council Takes Up Murray's Minimum-Wage Proposal

The city council gets a first bite at the minimum wage proposal Mayor Murray announced last week.

The city council started work today on Mayor Ed Murray's minimum wage plan—a plan hammered out by his 24-member Income Inequality Advisory Committee that included reps from labor, business, and non-profits—getting a briefing from Office of Policy and Innovation director Robert Feldstein and his wonky staffer Brian Surratt, whose handle on the complicated details of the proposal has been widely praised, about the the proposal to phase in $15-an-hour minimum wage.

Council members seemed generally pleased with the plan; even socialist and 15Now activist Kshama Sawant, who voted against the proposal in the committee because she felt it capitulated too much to "big business," praised the mayor and his staff. "I think this was incredible work and very historic," Sawant said.

A quick refresher on what the legislation would do: Big businesses, defined as those with 500 employees or more, would have to get to a base minimum of $15 in three years, or four for employees who receive health care.

"Small businesses," those with fewer than 500 workers, would have to pay a base wage of $10 an hour starting next year; that wage would rise gradually to $15 by 2021. However, they'd have to guarantee a higher minimum total compensation (wages plus extras like health care and tips); employers that don't provide health care or whose business model doesn't rely on tips would have to pay slightly higher wages. Eventually—by 2025—all businesses would be paying the same minimum wage, $18.13 an hour; after that, wages would increase by the rate of inflation.

As you can see, it's a complicated plan full of compromises and concessions to small businesses:

But the bottom line, as even the most progressive voices in town acknowledged today, is that the lowest-wage workers will immediately be better off than they are making the state minimum wage today. Sarah Cherin, lobbyist for the populist grocery workers' union, UFCW Local 21 and a member of Murray's Income Inequality Advisory Committee, said, "If I was to tell my workers that they were going to get a $1.50 wage increase, they would say that is progress."

Perhaps more tellingly, council member and 15Now organizer Kshama Sawant, who proposed her own plan that included no phase-in for big businesses, no "total compensation" or tip exemption, and a mere three-year phase-in for small businesses, had grudging praise for the deal, which she said would be "the strongest [minimum wage law] in the nation."

Mike O'Brien pointed out that $15 would represent a substantial raise for low-wage workers, even if it didn't kick in for a few years, and would have more buying power than Sawant's numbers suggested. Sawant—one of two committee members to vote against the proposal—acknowledged that "compromise is inevitable" and called the plan "really good." She tempered the praise for compromise by noting that one of the taskforce members, Ivar's owner Bob Donegan, actively worked against last year's $15 campaign in SeaTac, making the point that you have to put the compromise in the context of who's at the table. Citing high polling numbers for $15, she implied that Donegan had a disproportionate voice in the debate.

And then the discussion turned to math. On one side: Sawant, who argued that a phased-in $15 would be worth less a few years in the future because of inflation. On the other: Council members Nick Licata and Mike O'Brien, who pointed out that $15 would still represent a substantial raise for low-wage workers, even if it didn't kick in for a few years, and would have more buying power than Sawant's numbers suggested.

Displaying a confusing chart of her own, she pointed out that the real value of $15, adjusted for inflation, will be only around $14.11 when it kicks in at big businesses in 2017, and even less when it kicks in at smaller businesses or those counting tips and health care as part of total employee compensation.

In response, Nick Licata, who stood beside Murray and praised the plan when the mayor announced the final agreeement last week, pointed out that even though inflation would erode the value of the new minimum, $14.11 in 2017 (the big-business inflation-adjusted wage) is still a lot better than $10.01, which is what the state minimum wage will be.

And progressive Mike O'Brien, a former CFO, went further, noting that the state minimum wage is actually counted in nominal dollars, so it always has the same buying power—meaning that Sawant should really be comparing $14.11 to $9.54, the minimum wage in 2015. That's an even bigger improvement than it looks like on Sawant's chart, O'Brien said.

The council will likely tweak the plan somewhat—at last week's announcement, Licata noted jokingly that the council can't help but tinker with any legislation the mayor sends them—but today's meeting was a bit of a love-fest, incuding, even, a relucant Sawant.

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